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New Approaches to Measuring Management and Firm Organization

13 Pages Posted: 8 Jan 2010  

John Van Reenen

London School of Economics - Centre for Economic Performance (CEP); Stanford Graduate School of Business; Institute for Fiscal Studies (IFS); Centre for Economic Policy Research (CEPR)

Nicholas Bloom

Stanford University - Department of Economics; National Bureau of Economic Research (NBER)

Date Written: January 8, 2010

Abstract

The last three decades have witnessed an explosion of theoretical work on the organization of firms (Robert Gibbons and John Roberts, 2009). In parallel, there has been a massive increase in access to micro data which has revealed huge dispersions in productivity. For example, within narrow industries like cement, oak flooring, and block-ice the total factor productivity of plants at the 90th percentile is about twice that of those at the 10th percentile. (Lucia Foster, John Haltiwanger and Chad Syversson, 2008). Unfortunately, analyzing to what extent this heterogeneity in productivity is due to management and organizational practices, unmeasured inputs, or other technologies has been held back by a lack of data. National statistical agencies do not usually collect data on the internal organization of companies and nor do firms report this in their accounts. Recently, however, social scientists have been starting to fill this gap by working closely with small numbers of individual firms (e.g. the “Insider Econometrics” approach described in Kathryn Shaw (forthcoming)) or covering wide cross sections of firms (e.g. Nicholas Bloom, Raffaella Sadun and John Van Reenen (2009)). In this paper we describe some of the tools of this research, particularly Bloom and Van Reenen (2007) - henceforth BVR – for measuring management and organizational practices.

Keywords: management, organizations, survey, firm

JEL Classification: L2, M2, O32, O33

Suggested Citation

Van Reenen, John and Bloom, Nicholas, New Approaches to Measuring Management and Firm Organization (January 8, 2010). Available at SSRN: https://ssrn.com/abstract=1533438 or http://dx.doi.org/10.2139/ssrn.1533438

John Michael Van Reenen

London School of Economics - Centre for Economic Performance (CEP) ( email )

Houghton Street
London WC2A 2AE
United Kingdom
+44 20 7955 6976 (Phone)
+44 20 7955 6848 (Fax)

Stanford Graduate School of Business ( email )

655 Knight Way
Stanford, CA 94305-5015
United States

Institute for Fiscal Studies (IFS) ( email )

7 Ridgmount Street
London, WC1E 7AE
United Kingdom
+44 20 7240 6740 (Phone)
+44 20 7240 6136 (Fax)

Centre for Economic Policy Research (CEPR)

77 Bastwick Street
London, EC1V 3PZ
United Kingdom

Nicholas Bloom (Contact Author)

Stanford University - Department of Economics ( email )

Landau Economics Building, Room 231
579 Serra Mall
Stanford, CA 94305-6072
United States
650-725-7836 (Phone)

HOME PAGE: http://economics.stanford.edu/faculty/bloom

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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